Maryland homebuyers concerned about their credit score can still find mortgage options. Knowing where to start is key; you can check which Maryland lenders work with your credit score to find suitable financing. Even with less-than-perfect credit, researching and comparing lenders specializing in various credit profiles can open doors to homeownership in Maryland.
Why Your Credit Score is a Big Deal for a Mortgage
Lenders want to know you can pay them back. Your credit score tells them how risky it is to lend you money. A higher score means you’re a lower risk. A lower score? That means they’re going to look at your file a little closer—or charge you higher rates.
What Credit Score Do You Need for a Mortgage in Maryland?
Every lender has different requirements, but here’s a general idea of where you need to be:
- 720+ – You’ll get the best rates and terms.
- 680-719 – Still solid, but you might pay a slightly higher rate.
- 620-679 – You can qualify, but expect stricter requirements.
- Below 620 – Tough, but not impossible. You may need to look at FHA or other loan programs.
If you’re not sure where you stand, check your credit score before applying. Some lenders will give you a free soft credit check so you know where you are without hurting your score.
Maryland Lenders That Work with Different Credit Scores
Not all lenders are the same. Some specialize in helping buyers with lower scores. Others only work with high-credit borrowers. It’s all about finding the right fit.
Here are a few types of lenders that may work with different credit scores:
- Traditional banks – Good for buyers with high credit scores. They offer competitive rates but may have stricter requirements.
- Credit unions – Often more flexible than banks and willing to work with lower scores.
- Online lenders – Some online lenders have programs for lower credit scores.
- Government-backed loans (FHA, VA, USDA) – These loans have lower credit requirements and can be a great option if your score isn’t perfect.
If you’re looking for lender reviews or comparisons, check out the other housing finance guides on our blog.
How to Improve Your Credit Score Before Applying
If your score isn’t where you need it to be, don’t stress. You can still improve it before applying for a mortgage rate. Here’s how:
- Pay down debts – Credit utilization makes up a big chunk of your score. Try to keep it under 30% of your limit.
- Make on-time payments – Late payments drag your score down fast.
- Don’t open new credit accounts – Every new credit inquiry can shave a few points off.
- Fix errors on your credit report – Mistakes happen. Get a free credit report and dispute anything incorrect.
FAQs
Can I Get a Mortgage in Maryland with a 580 Credit Score?
Yes, but your options will be limited. FHA loans allow for scores as low as 580 with a 3.5% down payment.
How Much of a Down Payment Do I Need?
It depends on your loan type. FHA loans require as little as 3.5%, conventional loans usually start at 5%, and VA loans may not require one at all.
Will Shopping for a Mortgage Hurt My Credit?
If done within a short period (like 30 days), multiple mortgage inquiries count as one for your credit score.
Where Can I Find More Tips on Home Buying?
Check out more home-buying advice on our real estate blog.
